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The 8.8 per cent return by the Employees’ Provident Fund Organisation (EPFO) could have got better. It only needed some investment in equities as funds earning 12 per cent annually in the National Pension System do.

EPFO’s investment adviser Crisil had in April this year said that it must ease norms for investing in private sector bonds where 10 per cent of the Rs 3.5 lakh crore corpus is parked. Only seven companies — HDFC Bank, ICICI Bank and Axis Bank, HDFC, IDFC, LIC Housing Finance and ILFS are eligible as they have dual AAA ratings. So, EPFO’s 10 per cent window is never fully utilised. Officials complain that in 2011-12, of the total amount of Rs 5,760 core permitted to be invested in private sector, only Rs 5,460 crore (94 per cent) was invested.

The Central Board of Trustees — its apex decision making body has opted to defer the proposal and asked for a further study. The new criteria of including of AAA rated listed firms with a net profit of over Rs 5,000 crore and a minimum dividend of 25 per cent for last five years, would in fact crimp the investment basket. Some fresh and bolder ideas are clearly needed.

For instance, the EPFO could invest in bonds of blue chip manufacturing companies. Many such firms are known performers and have steady ratings. One hopes the new central PF commissioner who joins next month will push through much needed reforms to ensure that 5 crore subscribers are not punished with low returns for no fault of theirs.